What I'm Reading: January 1

Tech

• Concise and interesting talk recommended by a colleague from a Google SRE that helped fix Healthcare.gov:

• A thorough talk on the Rowhammer attack (as Rowhammer is in the news again):

• Log4j vulnerability is a really big deal

  • More from the Check Point blog: https://blog.checkpoint.com/2021/12/14/a-deep-dive-into-a-real-life-log4j-exploitation

  • https://blog.checkpoint.com/2021/12/13/the-numbers-behind-a-cyber-pandemic-detailed-dive

• More than 10 mobile apps found to be exposing payment API keys

• The risks of client-side scanning for illegal content

  • Months ago, Apple announced client-side scanning for illegal images on phones, allowing Apple and authorities to circumvent the encryption discussion. The PDF above discusses the risks of client-side scanning.

• Missouri governor threatens criminal prosecution against journalist who reported security flaw in government website

  • An absurd example of no good deed going unpunished.

• Independent security audit of popular password managers

• On the role of hubris in tech companies' failed ambitions, from the founder of Waze

Crypto

• A DeFi protocol called BadgerDAO was hacked - here is the post-mortem describing the hack

  • And that wasn't the only recent DeFi hack

  • Speaking of DeFi, here is a good overview of one of its more interesting capabilities: flash loans, a no-collateral loan that can be taken out, provided it is paid back within the same "transaction."

• Resources on Decentralized, Autonomous Organizations (DAOs)

  • What is a DAO?

• Over $100m of Metaverse "virtual real estate" sold in the first week of December

  • Some are betting on a virtual land boom.

  • It will be interesting to read these articles 10 years from now with the benefit of hindsight... will we see this like we saw Beanie Babies? (ouch, oops) Or will see see them only from afar as Metaverse real estate moguls sail away on yachts, laughing at those of us who missed out?

• RadioShack launching crypto exchange

  • This reminds me of the Long Island Blockchain debacle... surely this has to be a sign of irrational exuberance. I spent a few hours poking into this, so here we go...

  • Still so much I don't understand here... two guys (Retail Ecommerce Ventures) bought RadioShack to make them pivot to crypto? Why RadioShack? RadioShack presumably had / has no crypto talent... were they chosen for their brand? For their assets? Why not just start a new crypto company? From their documentation, it seems like they bought it for the brand recognition, but if someone can figure out why RadioShack, I'd be interested to hear it - send me a line.

    • And, presumably, if this were legitimate, you would see RadioShack hiring blockchain / crypto / software engineers... but I see no tech job postings at all: none on their LinkedIn, none on Indeed, and none on RadioShack.com (I can't even find a Careers page on their website).

    • I even did LinkedIn and Google searches for people who had listed RadioShack and Engineer on their LinkedIn profiles, but only found a few people who were currently working there, and nothing about crypto.

    • I even looked at the protocol RadioShack claims to be using, which is made by Atlas USV (Altus USV is also owned by RadioShack's new parent company, Retail Ecommerce Ventures) but no open jobs on LinkedIn or its website, either.

    • Maybe they're just coming out of "stealth mode" so they had all their engineers keep quiet? Or maybe they used contractors like on Upwork? I have no idea 🤷‍♂️

  • I also read through RadioShack's documentation on their protocol, and it is so transparently absurd... light on the technicals, heavy on the disruption nonsense.

    • For reference, here are docs from real, legitimate DeFi protocols: Aave, Compound, Uniswap, Balancer, Indigo, Chainlink, Band Protocol, Mirror... notice that they all have links to their code / GitHub, they give thorough, technical explanations of their protocols, they have developer how-tos, and there are no references to "crossing the chasm," the Weimar Republic, or waxing poetic about "symbiosis."

    • RadioShack says it's going to onboard Retail Ecommerce Ventures' other portfolio companies (Pier 1, Steinmart, Dressbarn, etc), but why would Pier 1 and Dressbarn have anything to do with DeFi? It's not unusual for a startup to get revenue from its venture capitalist's other portfolio companies, but why would retail brands be using crypto exchanges?

      • Maybe they're going to start accepting crypto as payment, or using crypto under the hood for paying their vendors, accounting, etc, and need an exchange? That's one of the only things I can think of.

  • RadioShack isn't public, so it doesn't seem like they're trying to pump the stock (unless they plan to go public again soon). The only real reason I can see for this DeFi buzz is that the two guys who own the parent company are trying to pump their upcoming RadioShack token, RADIO (which I'm guessing they will own a lot of).

  • I forwarded this story to my dad, who shared the dot-com bubble story of a fish-oil and sausage casing company, Zapata, that attempted to rebrand itself as an internet company and made a laughable (and failed) bid for then-giant Excite.com.

    • A 1998 article on Zapata reads:

To me it's brilliant what they're doing. They're not looking to build a company and sell it next week. They're building a solid company that will be worth a fortune one day.

• (oops...)

Investing

• Cathie Wood's ARK published its valuation model for Square

  • Very interesting! I'm still going through it and trying to understand whether their numbers make sense to me.

  • Looks like Cash App's user numbers have surpassed ARK's estimates for 2021, but I'm still digging into the monetization numbers.

• The Rate of Return on Real Estate

  • Residential real estate returns 2.3% per year in the long run, after costs (transaction costs, taxes, maintenance & repairs, insurance, etc).

  • (not mentioned in the paper: most people are leveraged with a mortgage, so the actual return is probably different if people sell before the house is paid off.)

• The Holistic Market Model

  • We've all heard a lot of "equities bubble" talk recently, but I like contrarian arguments... here's one that the market actually isn't that overvalued, given that corporate profits are near historic highs and we've seen generally favorable economic conditions for a while.

Career

• The Myth of A-Players

  • Worth a read. How an "A-Player" in one environment can struggle in another, using Apple superstar Ron Johnson's failed tenure at JC Penny as an example.

Skills are more specific and more difficult to transfer than many of us would like to believe. You can’t divorce performance outcomes from context, because the context is the thing you’re actually good at.

• Reads very similarly to Chasing Stars by Boris Groysberg... I posted the book notes here.

• Graham Duncan: Letter to a Friend Who Just Made a Lot of Money

• The Ford Pinto story, trading safety for cost

  • And some other good business ethics reads